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FINANCIAL INSTRUMENTS (Tables)
 12 Months Ended
Dec. 31, 2018
Investments, All Other Investments [Abstract]  
Fair Value of Financial Instruments
The following table summarizes the fair value of financial instruments at December 31, 2018 and 2017:

Fair Value of Financial Instruments at Dec 31
2018
2017
In millions
Cost
Gain
Loss
Fair Value
Cost
Gain
Loss
Fair Value
Cash equivalents 1
$
566

$
—

$
—

$
566

$
2,280

$
—

$
—

$
2,280

Marketable securities
$
100

$
—

$
—

$
100

$
4

$
—

$
—

$
4

Other investments:
 
 
 
 
 
 
 
 
Debt securities:
 
 
 
 
 
 
 
 
Government debt 2
$
714

$
9

$
(23
)
$
700

$
637

$
13

$
(11
)
$
639

Corporate bonds
1,026

20

(63
)
983

704

32

(3
)
733

Total debt securities
$
1,740

$
29

$
(86
)
$
1,683

$
1,341

$
45

$
(14
)
$
1,372

Equity securities 3
16

1

(1
)
16

164

2

(26
)
140

Total other investments
$
1,756

$
30

$
(87
)
$
1,699

$
1,505

$
47

$
(40
)
$
1,512

Total cash equivalents, marketable securities and other investments
$
2,422

$
30

$
(87
)
$
2,365

$
3,789

$
47

$
(40
)
$
3,796

Long-term debt including debt due within one year 4
$
(19,594
)
$
351

$
(971
)
$
(20,214
)
$
(20,517
)
$
6

$
(2,104
)
$
(22,615
)
Derivatives relating to:
 
 
 
 
 
 
 
 
Interest rates
$
—

$
—

$
(64
)
$
(64
)
$
—

$
—

$
(4
)
$
(4
)
Foreign currency
—

120

(43
)
77

—

22

(112
)
(90
)
Commodities 5
—

91

(178
)
(87
)
—

130

(256
)
(126
)
Total derivatives
$
—

$
211

$
(285
)
$
(74
)
$
—

$
152

$
(372
)
$
(220
)

1.
Prior period amounts were updated to conform with the current year presentation.
2.
U.S. Treasury obligations, U.S. agency obligations, agency mortgage-backed securities and other municipalities’ obligations.
3.
Equity securities with a readily determinable fair value. Presented in accordance with ASU 2016-01. See Notes 1 and 2 for additional information.
4.
Cost includes fair value hedge adjustments of $18 million at December 31, 2018 and $19 million at December 31, 2017 on $2,290 million of debt at December 31, 2018 and $2,390 million of debt at December 31, 2017.
5.
Presented net of cash collateral
Investing Results
The following table provides the investing results from available-for-sale securities for the years ended December 31, 2018, 2017 and 2016.

Investing Results 1
 
 
 
In millions
2018
2017
2016
Proceeds from sales of available-for-sale securities
$
1,053

$
245

$
396

Gross realized gains
$
21

$
5

$
15

Gross realized losses
$
30

$
—

$
1
Contractual Maturities of Debt Securities
The following table summarizes the contractual maturities of the Company’s investments in debt securities:

Contractual Maturities of Debt Securities at Dec 31, 2018 1
Amortized Cost
Fair Value
In millions
Within one year
$
124

$
124

One to five years
455

444

Six to ten years
717

683

After ten years
444

432

Total
$
1,740

$
1,683

1. Includes marketable securities with maturities of less than one year.
Fair Value and Gross Unrealized Losses of Investments Temporarily Impaired
The following tables provide the fair value and gross unrealized losses of the Company’s investments in debt securities that were deemed to be temporarily impaired at December 31, 2018 and 2017, aggregated by investment category:

Temporarily Impaired Debt Securities at
Dec 31, 2018
Less than 12 months
12 months or more
Total
Fair
Value
Unrealized
Losses
Fair
Value
Unrealized
Losses
Fair Value
Unrealized Losses
In millions
Government debt 1
$
287

$
(17
)
$
187

$
(6
)
$
474

$
(23
)
Corporate bonds
724

(58
)
64

(5
)
788

(63
)
Total temporarily impaired debt securities
$
1,011

$
(75
)
$
251

$
(11
)
$
1,262

$
(86
)

1.
U.S. Treasury obligations, U.S. agency obligations, agency mortgage-backed securities and other municipalities' obligations.

Temporarily Impaired Debt Securities at
Dec 31, 2017
Less than 12 months
12 months or more
Total
Fair
Value
Unrealized
Losses
Fair
Value
Unrealized
Losses
Fair Value
Unrealized Losses
In millions
Government debt 1
$
295

$
(4
)
$
151

$
(7
)
$
446

$
(11
)
Corporate bonds
163

(2
)
19

(1
)
182

(3
)
Total temporarily impaired debt securities
$
458

$
(6
)
$
170

$
(8
)
$
628

$
(14
)
1.
U.S. Treasury obligations, U.S. agency obligations, agency mortgage-backed securities and other municipalities' obligations.
Schedule of Notional Amounts of Outstanding Derivative Positions
The notional amounts of the Company's derivative instruments presented on a net basis at December 31, 2018 and 2017, were as follows:

Notional Amounts - Net
Dec 31, 2018
Dec 31, 2017 1
In millions
Derivatives designated as hedging instruments:
 
 
Interest rate swaps
$
2,049

$
185

Foreign currency contracts
$
4,457

$
4,343

Derivatives not designated as hedging instruments:
 
 
Interest rate swaps
$
5

$
—

Foreign currency contracts
$
19,285

$
12,041

1.
Prior period amounts were previously presented on a gross basis and have been updated to conform with the current year net presentation.

The notional amounts of the Company's commodity derivatives at December 31, 2018 and 2017, were as follows:

Commodity Notionals - Net
Dec 31, 2018
Dec 31, 2017 1
Notional Volume Unit
 
Derivatives designated as hedging instruments:
 
 
 
Hydrocarbon derivatives
39.9

71.3

million barrels of oil equivalent
Seed derivatives
—

3.9

million bushels
Derivatives not designated as hedging instruments:
 
 
 
Hydrocarbon derivatives
1.2

4.1

million barrels of oil equivalent
Power derivatives
73.9

—

thousands of megawatt hours
Schedule Fair Values of Derivative Instruments
The following tables provide the fair value and gross balance sheet classification of derivative instruments at December 31, 2018 and 2017:

Fair Value of Derivative Instruments
Dec 31, 2018
In millions
Balance Sheet Classification
Gross
Counterparty and Cash Collateral Netting 1
Net Amounts Included in the Consolidated Balance Sheets
Asset derivatives:
 
 
 
 
Derivatives designated as hedging instruments:
 
 
 
 
Foreign currency contracts
Other current assets
$
98

$
(42
)
$
56

Commodity contracts
Other current assets
47

(13
)
34

Commodity contracts
Deferred charges and other assets
18

(3
)
15

Total
 
$
163

$
(58
)
$
105

Derivatives not designated as hedging instruments:
 
 
 
 
Foreign currency contracts
Other current assets
$
128

$
(64
)
$
64

Commodity contracts
Other current assets
41

(1
)
40

Commodity contracts
Deferred charges and other assets
4

(2
)
2

Total
 
$
173

$
(67
)
$
106

Total asset derivatives
 
$
336

$
(125
)
$
211

 
 
 
 
 
Liability derivatives:
 
 
 
 
Derivatives designated as hedging instruments:
 
 
 
 
Interest rate swaps
Other noncurrent obligations
$
64

$
—

$
64

Foreign currency contracts
Accrued and other current liabilities
46

(42
)
4

Commodity contracts
Accrued and other current liabilities
111

(18
)
93

Commodity contracts
Other noncurrent obligations
86

(9
)
77

Total
 
$
307

$
(69
)
$
238

Derivatives not designated as hedging instruments:
 
 
 
 
Foreign currency contracts
Accrued and other current liabilities
$
103

$
(64
)
$
39

Commodity contracts
Accrued and other current liabilities
7

(4
)
3

Commodity contracts
Other noncurrent obligations
8

(3
)
5

Total
 
$
118

$
(71
)
$
47

Total liability derivatives
 
$
425

$
(140
)
$
285


1.
Counterparty and cash collateral amounts represent the estimated net settlement amount when applying netting and set-off rights included in master netting arrangements between Dow and its counterparties and the payable or receivable for cash collateral held or placed with the same counterparty.

Fair Value of Derivative Instruments
Dec 31, 2017
In millions
Balance Sheet Classification
Gross
Counterparty and Cash Collateral Netting 1
Net Amounts Included in the Consolidated Balance Sheets
Asset derivatives:
 
 
 
 
Derivatives designated as hedging instruments:
 
 
 
 
Foreign currency contracts
Other current assets
$
51

$
(46
)
$
5

Commodity contracts
Other current assets
20

(4
)
16

Commodity contracts
Deferred charges and other assets
70

(5
)
65

Total
 
$
141

$
(55
)
$
86

Derivatives not designated as hedging instruments:
 
 
 
 
Foreign currency contracts
Other current assets
$
75

$
(58
)
$
17

Commodity contracts
Other current assets
50

(5
)
45

Commodity contracts
Deferred charges and other assets
7

(3
)
4

Total
 
$
132

$
(66
)
$
66

Total asset derivatives
 
$
273

$
(121
)
$
152

 
 
 
 
 
Liability derivatives:
 
 
 
 
Derivatives designated as hedging instruments:
 
 
 
 
Interest rate swaps
Other noncurrent obligations
$
4

$
—

$
4

Foreign currency contracts
Accrued and other current liabilities
109

(46
)
63

Commodity contracts
Accrued and other current liabilities
96

(15
)
81

Commodity contracts
Other noncurrent obligations
143

(12
)
131

Total
 
$
352

$
(73
)
$
279

Derivatives not designated as hedging instruments:
 
 
 
 
Foreign currency contracts
Accrued and other current liabilities
$
107

$
(58
)
$
49

Commodity contracts
Accrued and other current liabilities
45

(6
)
39

Commodity contracts
Other noncurrent obligations
8

(3
)
5

Total
 
$
160

$
(67
)
$
93

Total liability derivatives
 
$
512

$
(140
)
$
372


1.
Counterparty and cash collateral amounts represent the estimated net settlement amount when applying netting and set-off rights included in master netting arrangements between Dow and its counterparties and the payable or receivable for cash collateral held or placed with the same counterparty.

Derivative Instruments, Gain (Loss)

Effect of Derivative Instruments
Amount of gain (loss) recognized in OCI 1
Amount of gain (loss) recognized in income 2
 
In millions
2018
2017
2016
2018
2017
2016
Income Statement Classification
Derivatives designated as hedging instruments:
 
 
 
 
 
 
 
Fair value hedges:
 
 
 
 
 
 
 
Interest rate swaps
$
—

$
—

$
—

$
—

$
(2
)
$
—

Interest expense and amortization of debt discount 3
Cash flow hedges:
 
 
 
 
 
 
 
Interest rate swaps
26

2

2

(3
)
4

6

Interest expense and amortization of debt discount
Foreign currency contracts
19

(30
)
8

(18
)
7

(5
)
Cost of sales
Foreign currency contracts
(3
)
(5
)
25

—

(17
)
(13
)
Sundry income (expense) - net
Commodity contracts
(45
)
35

55

(69
)
7

(28
)
Cost of sales
Net investment hedges:
 
 
 
 
 
 
 
Foreign currency contracts
116

(73
)
5

—

—

—

 
Total derivatives designated as hedging instruments
$
113

$
(71
)
$
95

$
(90
)
$
(1
)
$
(40
)
 
Derivatives not designated as hedging instruments:
 
 
 
 
 
 
 
Foreign currency contracts
$
—

$
—

$
—

$
101

$
(289
)
$
(180
)
Sundry income (expense) - net
Commodity contracts
—

—

—

(12
)
(9
)
6

Cost of sales
Total derivatives not designated as hedging instruments
$
—

$
—

$
—

$
89

$
(298
)
$
(174
)
 
Total derivatives
$
113

$
(71
)
$
95

$
(1
)
$
(299
)
$
(214
)
 
1.
OCI is defined as other comprehensive income (loss).
2.
Pretax amounts.
3.
Gain (loss) recognized in income of derivatives is offset by gain (loss) recognized in income of the hedged item.